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WORLD NEWS Saturday 9 June 2018

Italian economist: Markets will judge Italy's spending plans

By FRANCES D'EMILIO age. election. But the specter
ROME (AP) — The But the leaders haven't of a looming new election
economist who tried to said where they'd get the spooked the financial
form an Italian government funds to pay for all these markets and Cottarelli
amid political gridlock said measures. stepped aside.
Friday he's "truly worried" Cottarelli said there were A short-term technical
that the costly measures on already signs that markets government "wouldn't
the new populist leaders' were skeptical about have been able to fight
agenda will further swell Conte's ability to keep off speculative attacks,"
Italy's national debt and Italy's public spending he said, adding that Italy's
trigger a negative reaction under control. next election "would have
by the financial markets. He noted that on Thursday, revolved around the euro"
Carlo Cottarelli told Greek short-term bonds and whether it might Italy's premier-designate Carlo Cottarelli addresses the media
at the Quirinale presidential palace in Rome, Thursday, May 31,
reporters in Rome that a were offering a lower yield leave the single-currency 2018.
policy of increasing the than Italy's, an indication group.q Associated Press
public debt, as proposed investors thought Italy's
by new Premier Giuseppe bonds were riskier than
Conte, is "something that those of Greece, an EU
will leave Italy exposed country trying to emerge
to speculation" by the from years of a devastating
markets. financial crisis.
Conte's week-old The Conte government's
government, forged problem "isn't EU
between the right- regulations" limiting Italy's
wing League party and maneuvering room,
the euroskeptic 5-Star Cottarelli told the reporters.
Movement, is insisting that, "The problem is the reaction
if necessary, it will press of the markets," he said.
the European Union to An expert in trimming public
loosen regulations so that spending and a former
escalated spending won't International Monetary
by stymied by EU rules. Fund official, Cottarelli
Italy is one of the 19 nations added: "Europe has been
using the shared euro accommodating enough.
currency. It's the markets that aren't
Luigi Di Maio, the leader of accommodating" to
the 5-Stars, has promised to runaway government
give those who are jobless spending.
or have low incomes or Last month, after weeks of
pensions a guaranteed political impasse following
monthly minimum income March's inconclusive
of 780 euros ($918). League national election, President
leader Matteo Salvini wants Sergio Mattarella asked
to drastically lower tax Cottarelli to quickly
rates by enacting a flat-tax assemble a "technical"
system. Both want to undo government with a non-
pension reforms that have political Cabinet to guide
raised Italy's retirement Italy until it held an early